SUBJECT

Proposed revisions to State Bar Sample Fee Agreement forms

BACKGROUND

The State Bar of California publishes “Sample Written Fee Agreement Forms” for members of the bar to provide them with guidance on writing enforceable fee agreements that comply with the applicable statutes. The sample fee agreement forms were last revised in March 2010 to provide members with sample disclosure language to comply with recently enacted Rule of Professional Conduct 3-410 [duty to inform client if member lacks professional liability insurance].

During its review, the Mandatory Fee Arbitration (MFA) Committee observed that the sample arbitration and fee arbitration clauses should be updated to comply with a recent California Supreme Court opinion upholding enforcement of contractual fee arbitration, in lieu of a trial de novo in court, after non-binding mandatory fee arbitration.

PROPOSAL

The MFA Committee’s proposed revisions affect only the section in the Sample Fee Agreement Forms entitled “Other Clauses of Interest in Fee Agreements.” The proposed revisions include: 1) specify types of potential disputes subject to arbitration between the Attorney and Client and relocate the client’s “knowing waiver” language for inclusion in this clause; 2) change title of fee arbitration clause and add an explanation of and an optional provision for binding arbitration in lieu of a new court trial after non-binding MFA; and 3) in the sample mediation clause, include fee mediation by a local bar association provider and add that costs for mediation will be shared equally by the parties.